In line with its earnings warning last month, Eastman Kodak reported a decline in revenues and earnings in its third quarter. The Rochester, NY-based company had revenues of $3.3 billion, down 8% from the $3.6 billion reported in the same period in 2000. For the quarter (end-September 30), Kodak had net income of $96 million, compared with $418 million in the third quarter last year.
As part of additional cost-reduction plans beginning in the fourth quarter, Kodak said it would lay off 3,500 to 4,000 employees, for a total of 6,500 to 7,500 staff reductions in 2001. Kodak estimates that pre-tax savings from severance and other nonpersonnel actions will range from $400 million to $450 million in 2002.
The firm's Health Imaging division reported sales of $545 million, little changed from the third quarter of 2000. Earnings from operations dropped 64% to $51 million, however, reflecting declining sales of traditional products, as well as pricing pressures and operational issues that combined to reduce profit margins, according to Kodak.
Looking ahead, the deepening worldwide economic downturn continues to be a risk factor, according to the company. If pressures in its consumer imaging and health imaging units persist as anticipated, the vendor believes that fourth-quarter earnings will not exceed 15¢ per share on an operational basis. Third-quarter earnings on an operational basis were 52¢ per share.
By AuntMinnie.com staff writersOctober 24, 2001
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